Dan Steinbock

Dan Steinbock

About the author:

Dr Steinbock is an internationally recognized expert of the multipolar world. He focuses on international business, international relations, investment and risk among all major advanced economies and large emerging economies. In addition to advisory activities (www.differencegroup.net), he is affiliated with India China and America Institute (USA), Shanghai Institutes for International Studies (China) and EU Center (Singapore). For more, please see http://www.differencegroup.net/. Research Director of International Business at India China and America Institute (USA) and Visiting Fellow at Shanghai Institutes for International Studies (China) and the EU Center (Singapore).

The China-Australia free trade agreement is not just another FTA. In the coming decade, it will make a unique contribution to stability and prosperity in the Asia Pacific. After almost a decade of talks, China and Australia recently signed a Free Trade Agreement (FTA). After more than 20 rounds of talks spanning across three governments and five prime ministers, the two key negotiators, China’s Commerce Minister Gao Hucheng and Australia’s Minister for Trade and Investment Andrew Robb, eventually inked the deal.

Despite obstacles, the White House continues to push preferential trade deals in Asia and Europe. However, neither can reverse the erosion of U.S. innovation and in Asia Pacific, the proposed pact is more likely to divide than unify the region.

For a quarter of a century, China's economic crash theory has been a lucrative cottage industry in the West. However, there is a reason why certain times favor the doomsayers. At the turn of the millennium, Gordon Chang’s The Coming Collapse of China (2001) exemplified the economic crash theory. In reality, that is when China became a member of the World Trade Organization and growth soared to double digits until the West's financial crisis in 2008-09. Therefore, any investor who took the theory seriously lost big time.

Nigeria’s huge economic potential is no dream. It will not materialize on its own. It requires determination. The Buhari era can make or break the path to the Nigerian dream.When retired Muhammadu Buhari took over from Goodluck Jonathan, it marked the first peaceful transfer of power between rival parties in Nigeria. Unlike most advanced nations and many emerging nations, Nigeria has extraordinary economic potential. However, even favourable demographics are of little value without productivity, growth, and jobs.

China and India are ready for breakthrough diplomacy that has the potential to reorder the face of Asia, while supporting global growth prospects. From May 14th to 16th, India’s Prime Minister, Narendra Modi, will make a three-day trip to China and meet President Xi Jinping. It can be seen as Act 2 to the September 2014 visit President Xi made with Prime Minister Modi in New Delhi. The meeting did result in substantial trade deals but not yet in a diplomatic breakthrough.

After decades of international isolation, Iran is eager to enter its post-sanction era, while Washington is divided about Iran’s future and Brussels remains apprehensive. Recently, Peter Wittig, German Ambassador to the US, said that alternatives to a deal to curb Iran’s nuclear program are “not very attractive.” He added that Germany and other nations are ready to move beyond sanctions, despite what the US Congress might do.

As China seeks to further boost the e-commerce sector, it is likely to attract new capital and create new jobs and entrepreneurs.

Recently, the State Council, China's cabinet, announced that it would boost the development of e-commerce by cutting red tape and liberalizing investment regulation in the sector. Reportedly, the new measures include a tax cut, simpler administrative procedures and a push for entrepreneurship.

China’s GDP growth rate is decelerating, due to international headwinds, property markets and local debt. Nevertheless, China’s long-term potential remains impressive, as reflected by the new growth target.

As the hard talks on Greece’s bailout start again, there is no time to lose. A compromise is possible. Before the weekend, Euro group president Jeroen Djisselbloem said that “Greece wants a lot but has very little money to do that. That’s really a problem.”

Unlike before, Nigeria’s elections are overshadowed by violent terrorism. It reflects an economic, ethnic and religious divide. It can be overcome – not by further violence, but by policies that will eliminate its raison d’être.

In 2013, the Sino-US relations ended with concern over strategic mistrust. In 2014, bilateral relations were characterized by a sense of optimism. While bilateral trust may endure through the Obama era, challenges will ensue thereafter.

After Greek elections, Brussels and Berlin can no longer shun the issue of debt relief. Before the New Year, the Hellenic parliament rejected the nominee of Prime Minister Antonis Samaras for president. In accordance with the Greek constitution, a general election will follow on January 25.

For quarter of a century, global climate change talks have suffered from a stalemate between major advanced nations and large emerging economies. Since Lima’s climate conference could not resolve it, it deferred the divide to Paris 2015. Recently, world’s leading nations gathered in Lima, Peru, for the 2014 U.N. Climate talks. The procedural objective was to develop the foundation for a new climate agreement that could be signed in Paris in December 2015 and that would take effect by the 2020s.

Japan’s recession is not paving way for sustained growth. It is prolonging new debt and liquidity and thus deteriorating fiscal discipline. In the last quarter, Japan’s economy fell into recession. In the West, it was characterized as “unexpected.” The realities are precisely the reverse. With its third ’lost decade,’ Japan has entered an era of massive monetary expansion that it not adequately supported by the fundamentals of its economy.

If the APEC meeting can agree on the proposed regional free trade plan and a reasonable implementation schedule, it would take a leap into faster regional growth and prosperity. The Asia-Pacific Economic Cooperation (APEC) forum on November 10-11 will take place amidst the rebalancing of China, the United States and the integration of Southeast Asia, which is causing substantial system friction.